Before the FIFA World Cup began in Brazil, Goldman Sachs forecast that the winner would be the team from the host country. However, ING was confident that the winners would be the "Red" team from Spain, which emerged the victor in the 2010 World Cup.

Although past statistics provide no guarantees for the future, they have influenced the prices that companies pay for insurance policies that cover marketing campaigns linked to the results of the World Cup.

Germany's crushing defeat of Brazil in the semi-finals, and the inability of Spain to go beyond the initial round of matches, has demonstrated how difficult it is to predict the winning team in a sport that involves so many complex variables, or the wisdom of making promotional promises linked to the results of the Cup competition.

The FIFA World Cup will bring in a total of more than 1.5 billion euros (about $2.045 billion) in sponsorships from major brands. But the soccer tournament has also involved expenditures of billions of dollars in a secondary market in which companies try to take advantage of the image of their national teams.

In these kinds of promotional campaigns, firms promise, for example, that if the national team from their home country winds up winning the championship, they will award prizes — such as a new car — to some customers, or that they will refund the purchase price of products bought as part of the campaign.

For example, in a strategy that became popular during the 2008 European Cup, German electronics retailer Media Markt was compelled to refund 25 per cent of the price of the television sets purchased by more than 13,000 customers.

The retailer had promised to do so if Spain reached the quarterfinals of the competition. This marketing campaign was so successful that the retailer repeated it during the 2010 World Cup. The second time around, however, the campaign was more selective, as the retailer promised to refund consumers' purchase price only if Spain's Red team was able to win all of its matches.

Similar promotions have been launched by other companies, such as computer maker Toshiba and even Spain's Banesto Bank (which is now part of Santander Group). Overall, the sectors that employ this type of marketing promotion most frequently are technology, food, hotels, banking and supermarkets.

Businesses of all sizes are mounting such campaigns — including small local firms, notes Andres Martinez, a specialist on sports events at the Marsh & McLennan international insurance brokerage house in Madrid.

In the world of soccer, "one referee can make a mistake" that proves key to the eventual outcome of a game, yet has no chance of being reversed. Why are so many firms engaged in World Cuprelated promotions? Felipe Monteiro, a senior fellow at Wharton's Mack Institute for Innovation Management, says that interest in the World Cup has peaked "as audiences view matches that are broadcast simultaneously around the world" and discussed on social media.

Although the "passion was always there," he notes, the explosion of social media channels has heightened interest in World Cup games. The insurance premiums paid for hedging the potentially high cost of such campaigns are based on widely varying assessments of the likelihood that various teams will emerge as the ultimate winner of the Cup. For its part, Goldman Sachs has studied the statistics available about World Cup competitions ever since 1960.

According to its calculations, announced before the matches began, Spain had a 9.8 per cent chance of winning the top prize, compared with Brazil's 48.5 per cent chance. Goldman Sachs put Argentina's chances of winning at 14.1 per cent, and Germany's at 11.4 per cent.

According to Goldman's analysis, the chances of a Spanish victory were lower because "as history shows, the dominant force is always beaten at some point," and Spain has been the top team since 2008.

ING used a completely different set of data to predict that Spain's team would be the grandprize winner. Rather than focus on historical statistics, the firm's research took other variables into account, particularly the quality of the players on each team.

ING's view of quality focused not on sports achievements, but the total market value of the members of each team. For example, the Spanish team was valued at 675 million euros (some $920 million), compared with 609 million euros for Germany, and 507 million euros for Brazil.

Another financial institution, Danske Bank, also made its own financial forecasts, in which Spain did not play as big a leading role as its rivals. Danske had Spain falling to Italy during a quarterfinal round. (In reality, Italy, too, was eliminated in the group-stage round.)

According to the institution's forecast, the Spanish team had only a 4 per cent probability of winning the World Cup. The now-eliminated Brazilian team was the favorite in Danske's analysis, with a 45 per cent chance of victory.

Wharton management professor Mauro Guillen, who is also head of the Lauder Institute, notes that statisticians have made significant progress in gathering and analyzing the type of data that is useful in determining why a particular team will succeed.

It is important to create a statistical model that analyzes the right kinds of data, he says, using such statistical measures as how long a team keeps the ball, and whether it tends to rely mostly on one or two star players. But Guillen adds that soccer "is one of the hardest sports to predict" because there are so many different variables at play.

(Reproduced with permission from Knowledge@Wharton 2014 and the Trustees of University of Pennsylvania. All rights reserved)